I have been working since March 2008.I started working as a OPT employee and then applied for HIB the same year. My H1B started Oct 2009. Last year (filing April 2009)my tax lawyer filed 1040 long form for me in spite of me telling him that I am on OPT. Also my employer held my social security and medicare taxes in my w2. Not knwoing any better I received 600 dollars of return as a resident and my medicare and social security taxes with gone without my knowledge.

I want to file for correction and claim my social security and medicare taxes and also correct the wrong form so It doesn't create problem with my GC application in future (I have not applied for GCyet).
My question is -
1. What forms do I need to file?
2. Should I talk to my employer to get my withheld taxes back from last year?
3. My incompetent lawyer says that the medicare and SS taxes do not go to IRS and I cannot reclaim them from IRS.Is that true?
4. Which way is the best way if my employer turns down my request for refund?

First, you need to amend the 2009 tax return and have the IRS re-instate your non-resident alien status for 2009. This shouldbe done regardless of whether you will submit Form 843 below.

Contact your employer and see if he will refund the improperly-withheld FICA (Social Security and Medicare) taxes. The IRS requires you try this before you submit the Forms 843/8316, and the employer can get the refund MUCH faster (maybe a month). If the employer refuses, try to get a refusal letter on company letterhead.

Once that is done, you will submit Forms 843 and 8316 to request a refund for the FICA (Social Security and Medicare) taxes withheld while you were on OPT status. The refund process can take UP TO a year until you get the money, but typically, it takes 4-6 months.

If you need professional help filing your return, email me at [email protected] or [email protected].

Thank you very much! This helped a lot. My employer has agreed to return my taxes. Thanks!

Glad to help!